Infy board approved a share buyback up to Rs 8,260 crore.

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New Delhi: Infosys, India's second-biggest outsourcer, reported better-than-estimated revenue for the October-December quarter of the current financial year but higher operating cost led to a decline in its net profit, missing estimates. Infy board has also approved a share buyback up to Rs 8,260 crore.

The Bengaluru-based company reported 12.2% sequential decline in its net profit at Rs 3,610 crore for the quarter ending December 31, 2018, while its revenue grew 3.8% q-o-q to Rs 21,400 crore. The outsourcer had reported a net profit of Rs 4,110 crore on revenues of Rs 20,609 crore for the September quarter of current fiscal.

The company said its net profit was impacted due to additional depreciation and amortization expenses of $12 million as it reduced the fair value and carrying value of Panaya and Skava.

Analysts polled by ET Now had estimated Infosys' profit at Rs 4,136 crore on revenues of Rs 21,264 crore.

“Volume growth was strong and revenue productivity was stable despite Q3 being a seasonally weak quarter. We had good growth across geographies and large business segments”, said Pravin Rao, COO. “Attrition declined during the quarter and we are continuing on the path of increased interventions and employee engagements to reduce it further.”

In constant currency terms, Infosys' dollar revenue grew at a better-than-estimated rate of 2.7% sequentially to $2,987 million, which led to an upward revision in its annual revenue guidance for FY19. The company raised FY19 revenue growth guidance to 8.5-9% in cc terms but retained operating margin guidance at 22-24%. Its operating margin, in Q3, came in at 22.6%, at lower-end of its guidance.

“With increased client relevance, we saw double digit (10.1%) year-on-year growth in Q3 on a constant currency basis”, said Salil Parekh, CEO and MD. “We also had another strong quarter in our digital business with 33.1% growth and large deals at $1.57 billion which gives us confidence entering 2019”, he added.

Source: ET Now

Digital revenues of the company, which is highly tracked by analysts, grew 33.1% annually to $942 million (31.5% of total revenues). It represents sequential growth of 5.0% in constant currency terms.

Meanwhile, Infosys board has approved a share buyback to the tune of Rs 8,260 crore at a price not exceeding Rs 800 per share. It also announced a special dividend of Rs 4 per share. The buyback represents 2.36% of its total paid-up capital.

With the announcement of share buyback and special dividend, the company would complete the distribution of Rs 13,000 crore, which was announced as part of its capital allocation policy in April 2018, Infosys said.

Infosys board also approved the re-appointment of Kiran Mazumdar-Shaw as the Lead Independent Director from April 1, 2019 to March 22, 2023, subject to shareholder’ approval.

“I am delighted that the Infosys Board of Directors has unanimously recommended Kiran Mazumdar Shaw for reappointment as the Lead Independent Director.”, said Infosys chairman Nandan Nilekani.